STI down for 2nd day on limp trading
SINGAPORE shares dawdled through another slow day, with investors unwilling to enter the year-end market amid a dearth of good news.
The Straits Times Index (STI) fell for a second day, paring 14.84 points or 0.52 per cent to 2,861.19. Volume was also tepid, with only 806.6 million shares transacted across the whole market.
Remisier Desmond Leong said that with such weak volumes, local shares will be vulnerable to wild swings created by market events and volatility will be the norm for the remainder of this year.
"For instance, everyone is expecting a rate hike announcement by the (United States) Federal Reserve next week, but the fact is nobody really knows for sure. Not many will want to bet against this much uncertainty."
In its Singapore equities report yesterday, Citi Research anticipated a similarly choppy outlook, tipping a slow year in 2016 with the STI closing at 3,033 by year end - a fraction above current levels.
"Singapore has been among Asean's weakest markets year-to-date due to concerns about the impact of China's slowdown," Citi said, adding that Singapore companies will continue to face the pressure of economic restructuring.
Citi's top picks include Venture Corp and ST Engineering, both earning US dollar and hence less susceptible to currency pressure. Flight service provider Sats is also favoured for its strong cash flow generation and exposure to a growing aviation traffic in Asia.
ST Engineering was one of the better performers on the STI, rising two cents or 0.69 per cent to $2.92. Sats also rose, up two cents or 0.53 per cent to $3.82.
The top gaining blue chip was Noble Group, up 1.5 cents or 3.85 per cent to 40.5 cents, while Singapore Press Holdings put on two cents or 0.52 per cent to $3.87.
But the day's highlight was China Environment. The green tech firm was the market's top active counter with 61.99 million shares changing hands. Its shares shot up 2.6 cents or 43.33 per cent to 8.6 cents.
The surge came before China Environment announced that unit Fujian Dongyuan Environmental Protection has won a bank loan approval that would lift its credit record.
Neptune Orient Lines (NOL) closed flat at $1.22, with the market seemingly unmoved by the offer from CMA CGM to buy out NOL at $1.30 a share.
Overseas markets were mixed, with Shanghai rising a marginal 0.07 per cent. However, Hong Kong dropped 0.46 per cent and Tokyo lost 0.98 per cent.